A. Investment
B. Valuation
C. Economy
D. Depletion
Correct Answer: Valuation ✔
Last Updated: January 22, 2019
Related MCQs
- In computing depreciation of an equipment, which of the following represents the first cost ?
- The first cost to be incurred if the piece of equipment now in place had been bought for a second hand dealer or some other business is called __________?
- What refers to the value of an intangible item which arises from the exclusive right of a company to provide a specified product and service in a certain region of the country ?
- What refers to the value of an asset which a disinterested third party, different from the buyer and seller, will determine in order to establish a price acceptable to both parties ?
- Salvage value is sometimes known as __________?
- The amount of property in which a willing buyer to a willing seller for the property when neither one is under the compulsion to buy nor to sell is called __________?
- A mathematical expression also known as the present value of annuity of one is called __________?
- What do you call the after-tax present worth of all depreciation effects over the depreciation period of the asset ?
- Using factor method, the depletion at any given year is equal to ?
- What is another term for “unit method” for computing depletion ?
- The depletion allowance method of computing depletion is commonly known as __________?
- Under the depletion allowance method in computing depreciation, the depletion charge is equal to either __________ which ever is smaller ?
- What are the common methods of computing depletion charge ?
- What is defined as the reduction of the value of certain natural resources such as mines, oil, timber, quarries, etc. due to the gradual extraction of its contents ?
- The functional depreciation is sometimes called __________?
- What type of depreciation is due to the reduction of the physical ability of an equipment or asset to produce results ?
- What type of depreciation is due to the reduction in the demand for the function that the equipment or asset was designed to render ?
- The declining balance method is also known as __________?
- In what method of computing depreciation where it assumes that the annual cost of depreciation is a fixed percentage of the book value at the beginning of the year ?
- In what method of computing depreciation where it assumes that a sinking fund is established in which funds will accumulate for replacement purposes ?
- In what method of computing depreciation where it assumes that the loss in value is directly proportional to the age of the equipment or asset ?
- What is defined as the reduction or fall of the value of an asset due to constant use and passage of time ?
- The price at which the callable bond will be redeemed from the bondholder is called __________?
- What is the feature of some bonds whereby the issuer can redeem it before it matures ?
- What type of bond which can be redeemed before maturity date ?
- What type of bond where the corporation’s owner name are recorded and the interest is paid periodically to the owners with their asking for it ?
- A type of bond where the corporation pledges securities which it owns such as the stock or bonds of one of its subsidiaries ?
- A bond without any security behind them except a promise to pay by the issuing corporation is called __________?
- What bond whose security is a mortgage on certain specified assets of the corporation ?
- A type of bond to which are attached coupons indicating the interest due and the date when such interest is to be paid is called __________?
- What type of bond whose guaranty is in lien on railroad equipment, such as freight and passenger cars, locomotives, etc ?
- What type of bond is issued jointly by two or more corporations ?
- What refers to a document that shows proof of legal ownership of a financial security ?
- A leading shoe manufacturer produces a pair of Lebron James signature shoes at a labor cost of P 900.00 a pair and a material cost of P 800.00 a pair. The fixed charges on the business are P 5,000,000 a month and the variable costs are P 400.00 a pair. Royalty to Lebron James is P 1,000 per pair of shoes sold. If the shoes sell at P 5,000 a pair, how many pairs must be produced each month for the manufacturer to break-even ?
- A telephone switchboard 100 pair cable can be made up with either enameled wire or tinned wire. There will be 400 soldered connections. The cost of soldering a connection on the enameled wire will be P 1.65 on the tinned wire, it will be P 1.15. A 100- pair cable made up with enameled wire cost P 0.55 per linear foot and those made up of tinned wire cost P 0.75 per linear foot. Determine the length of cable run in feet so that the cost of each installation would be the same ?
- A manufacturing firm maintains one product assembly line to produce signal generators. Weekly demand for the generators is 35 units. The line operates for 7 hours per day, 5 days per week. What is the maximum production time per unit in hours required of the line to meet the demand ?
- A manufacturer produces certain items at a labor cost of P 115 each, material cost of P 76 each and variable cost of P 2.32 each. If the item has a unit price of P 600, how many units must be manufactured each month for the manufacturer to break even if the monthly overhead is P428,000 __________?
- The Saudi Arabian Oil Refinery developed an oil well which is estimated to contain 5,000,000 barrels of oil at an initial cost of $ 50,000,000. What is the depletion charge during the year where it produces half million barrels of oil? Use Unit or Factor method in computing depletion?
- Shell Philippines, a multinational company, has a total gross income for a particular year of P 50,000,000. The taxable income after taking all deductions except for depletion is P 18,500,000. What is the allowable depletion allowance for that particular year? Take percentage of gross income for oil as 22%?
- An asset is purchased for P 9,000.00. Its estimated economic life is 10 years after which it will be sold for P 1,000.00. Find the depreciation in the first three years using sum-of-years digit method__________?
- ABC Corporation makes it a policy that for any new equipment purchased, the annual depreciation cost should not exceed 20% of the first cost at any time with no salvage value. Determine the length of service life necessary if the depreciation used is the SYD method ?
- A machine costs of P 8,000 and an estimated life of 10 years with a salvage value of P 500. What is its book value after 8 years using straight line method ?
- A VOM has a selling price of P 400. If its selling price is expected to decline at a rate of 10% per annum due to obsolescence, what will be its selling price after 5 years ?
- A P 1, 000, 6% bond pays dividend semiannually and will be redeemed at 110% on June 21, 204. It is bought on June 21, 2001 to yield 4% interest. Find the price of the bond ?
- A P 1,000,000 issue of 3%, 15-year bond was sold at 95%. What is the rate of interest of this investment ?
- Miss Calledo deposited P 1,000, P 1,500 and P 2,000 at the end of the 2nd year, 3rd year and 4th year, respectively in a savings account which earned 10% per annum. How much is in the account at the end of the 4th year ?
- A young engineer borrowed P 10,000 at 12% interest and paid P 2,000 per annum for the last 4 years. What does he have to pay at the end of the fifth year in order to pay off his loan ?
- A person buys a piece of lot for P 100,000 downpayment and 10 deferred semi-annual payments of P 8,000 each, starting three years from now. What is the present value of the investment if the rate of interest is 12% compounded semi-annually ?
- A man loans P 187,400 from a bank with interest at 5% compounded annually. He agrees to pay his obligations by paying 8 equal annual payments, the first being due at the end of 10 years. Find the annual payments ?
- What is the present worth of a year annuity paying P 3,000.00 at the end of each year, with interest at 8% compounded annually ?
- A factory operator bought a diesel generator set for P 10,000.00 and agreed to pay the dealer uniform sum at the end of each year for 5 years at 8% interest compounded annually, that the final payment will cancel the debt for principal and interest. What is the annual payment ?